{"id":399915,"date":"2025-09-05T12:04:13","date_gmt":"2025-09-05T12:04:13","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/399915\/"},"modified":"2025-09-05T12:04:13","modified_gmt":"2025-09-05T12:04:13","slug":"fast-fashions-quick-decline-asos-and-boohoo-have-that-post-covid-feeling-asos","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/399915\/","title":{"rendered":"Fast fashion\u2019s quick decline: Asos and Boohoo have that post-Covid feeling | Asos"},"content":{"rendered":"

Once the feared enemy of the high street and worth more than \u00a35bn, the online fashion retailer Asos<\/a> has seen its value slump as it faces difficulties that could herald the demise of fast fashion.<\/p>\n

The London-based seller dropped out of the FTSE 250 with a whimper this week, valued at about \u00a3320m.<\/p>\n

Four years ago Asos, and its fellow online fast fashion purveyor Boohoo<\/a>, were booming as the high street suffered from Covid pandemic lockdowns, and largely housebound shoppers had cash to spare for slouchy leisurewear.<\/p>\n

They thought shoppers had been permanently converted to online shopping, and stocked up accordingly, only for Asos to find itself lumbered with a \u00a31bn stock hangover as, post-pandemic, young and old alike once again enjoyed the freedom to try on clothes and stalk the high street.<\/p>\n

By the end of 2021 Nick Beighton resigned as chief executive<\/a> with profits headed downwards \u2013 and the new boss, Jos\u00e9 Antonio Ramos Calamonte, has yet to stem the decline.<\/p>\n

Pippa Stephens, a senior analyst at GlobalData, says the brand, which celebrated its 25th anniversary this year, is struggling to mature with its customers or win over a new generation: \u201cIts styles are often too young for the millennial shoppers that grew up with it, while still not attracting Gen Z consumers.\u201d<\/p>\n

The same might be said of its fellow fast fashion player Boohoo. Less than a decade ago, Boohoo and its sister brand Pretty Little Thing were behind splashy events in the US featuring the Kardashians or the model Jordyn Woods<\/a>. Today, Pretty Little Thing is up for sale<\/a> and Boohoo has renamed its group Debenhams, seemingly focused on chasing middle-aged shoppers by remaking the department store online.<\/p>\n

John Stevenson, a retail analyst at Peel Hunt, says Debenhams\u2019 strategy indicates it has virtually \u201cthrown in the towel\u201d on fast fashion. \u201cThey have completely pivoted away from what they were. Chasing a price point is not a market they see a future in. Margin has collapsed.\u201d<\/p>\n

The pivot comes as Asos and Boohoo face much sharper competition, whether that\u2019s from Zara\u2019s edgy and rapid fashion shoots, Shein\u2019s cheap prices and mastery of social media, the secondhand specialist Vinted\u2019s one-off bargains or Next\u2019s mix of broad choice and delivery options.<\/p>\n

The market is also tough. Online fashion sales bounced back to outstrip the high street last year, with sales up 3%, to \u00a334bn according to Mintel, but in general \u201cpeople are more cautious about shopping\u201d, according to the market research firm\u2019s associate director of fashion retail research, Tamara Sender Ceron.<\/p>\n

Price has become important as shoppers have less to spend and fashion is competing with plenty of other options, from holidays and music festivals to phone bills and streaming services.<\/p>\n

\u201c[Asos] primarily caters to young consumers, who have lower discretionary incomes, and are therefore seeing greater strain on their wallets, causing them to prioritise value for money by either switching to even cheaper competitors or trading up to more premium brands that offer superior quality,\u201d says Stephens.<\/p>\n

In that environment, the China-founded marketplace Shein has undercut the likes of Boohoo and Asos on price and proved more nimble on marketing and fashion so that it now accounts for \u00a32bn of UK sales<\/a>.<\/p>\n

Today, a third of women aged 16 to 24 buy their clothing from Shein, according to Mintel, a big bite out of Asos\u2019s twentysomething heartland. \u201cThe growth of Shein and Temu is a huge factor [in Asos\u2019s sales decline], Ceron says. \u201cIt is particularly successful among younger shoppers.<\/p>\n

\u201cIt is also a threat to other fashion retailers such as Primark and H&M because of its ultra-low price model that nobody can compete with. It\u2019s changed the market.\u201d<\/p>\n

Shein has partly benefited from a tax break on import duty on goods worth less than \u00a3135 sent direct to consumers, while items valued at \u00a339 or less also do not attract import VAT.<\/p>\n

The chancellor, Rachel Reeves, is reviewing<\/a> whether to follow the lead of the US, which has gradually closed its version of the loophole in recent months, and the EU, which will do so next year.<\/p>\n

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That could put a dampener on Shein\u2019s rise and force it to raise prices.<\/p>\n

However, price is not its only weapon. Shein has invested heavily in technology and supply chain systems, which enables it to spot and react to trends extremely rapidly. It is also very tuned into the way young people use their phones, using social media, search and video marketing to put products at the forefront of shoppers\u2019 minds.<\/p>\n

With profits under pressure from falling sales, inflation on wages and new regulatory demands, such as packaging and European textile waste rules, more established retailers are struggling to invest sufficiently to keep up with Shein\u2019s digital innovation.<\/p>\n

\u201cWith AI you have really got to keep up and shoppers are almost ahead of retailers with how they are using technology such as ChatGPT to search. Some of the bigger retailers are not as flexible in keeping up,\u201d says Ceron.<\/p>\n

Innovation of another kind is also in play.<\/p>\n

The secondhand marketplace Vinted has taken another big bite of the market, with a mix of easy dropoff and collection services using lockers, addictive app-based marketing and the ability to make money to spend from trading your wardrobe. That comes with the feelgood factors of buying more sustainable secondhand goods and finding one-off outfits to impress friends.<\/p>\n

\u201cSecondhand is completely normalised, particularly among younger people, and it is undoubtedly taking growth away from buying new,\u201d Ceron says.<\/p>\n

It\u2019s a tough game, but Stevenson believes that Asos has put the building blocks in place to fight back.<\/p>\n

It has clamped down on unprofitable shoppers who sent back more than they bought, cleared its stock backlog, ended its reliance on heavy discounts and tightened its ranges. While it still carries expensive debt, Asos has also strengthened its balance sheet after selling a stake in Topshop and Topman to the billionaire behind Vero Moda and Jack & Jones for \u00a3135m.<\/p>\n

He says the next phase is to prove it can still be relevant to its shoppers with the right collaborations, exclusive products and good design. \u201cThere isn\u2019t any reason they can\u2019t get back into growth if they have compelling product at the right price,\u201d he says. \u201cThat\u2019s the next question.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Once the feared enemy of the high street and worth more than \u00a35bn, the online fashion retailer Asos…\n","protected":false},"author":2,"featured_media":399916,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[51,16,15],"class_list":{"0":"post-399915","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-business","9":"tag-uk","10":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115151599343839613","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/399915","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=399915"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/399915\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/399916"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=399915"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=399915"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=399915"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}